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Report: Promsvyazbank bought back over $450M of subordinated debt in September

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Report: Promsvyazbank bought back over $450M of subordinated debt in September

PAO Promsvyazbank repurchased subordinated bonds worth over $450 million in September and now holds over 40% of its subordinated debt, Vedomosti reported Oct. 4.

Promsvyazbank's representative said the lender is interested in buying back the subordinated debt below its nominal value and plans to carry on with the periodic repurchases of its instruments from the market, the newspaper noted.

Meanwhile, the price of lender's subordinated bonds due in July 2021 dropped from 110% to 82.5% of their nominal value on Oct. 4, while the price of Promsvyazbank's subordinated bonds maturing in March 2021 fell from 107% to 103% of the nominal value. The prices of the lender's other subordinated bond issues were stable, Vedomosti said.

Another Russian privately owned lender, PAO Credit Bank of Moscow, also recently announced the buyback of the outstanding $106.2 million notes from its $500 million issue due 2018. Credit Bank of Moscow's main shareholder, Rossium, said in September it was considering the buyback of three subordinated bond issues of the lender, after their prices were negatively affected by the bailout of Otkritie Financial Corp. Bank and B&N Bank.